A new proposed class-action lawsuit has the potential to put money back in the pockets of many car owners who have experienced a total loss accident. Gluckstein Lawyers and Wagners Law Firm have launched a class action targeting several prominent car insurance companies. The lawsuit alleges that these insurers systematically underpaid consumers for total loss claims by relying on inaccurate and unfair vehicle valuation reports.
The class action claims that car insurance companies have been using reports from Mitchell International, Inc. and Audatex (also known as Solera) to assess the Actual Cash Value (ACV) of vehicles involved in accidents. According to the lawsuit, these valuation reports have included controversial adjustments, such as the “Projected Sold Adjustment” and the “Typical Negotiation Adjustment,” which lower the value of vehicles and, consequently, the compensation paid to policyholders.
Term vs. Permanent Life Insurance in Canada: Which One Best Fits Your Financial Goals?
How to Secure a Mortgage in Canada with Bad Credit: A Step-by-Step Guide
These adjustments, according to the plaintiffs, are based on arbitrary and flawed assumptions. Specifically, the lawsuit claims that the “Projected Sold Adjustment” and “Typical Negotiation Adjustment” rely on outdated and misleading assumptions about the used car market. These reports presume that consumers always negotiate a lower price than the dealer’s listed price, which the plaintiffs argue is both inaccurate and unfair.
“This class-action lawsuit seeks to hold insurance companies accountable for practices that have unfairly reduced the compensation owed to consumers during their time of need,” explained Steven Rastin, co-chair of the class actions practice group at Gluckstein Lawyers.
By using flawed valuation methods, these insurers are allegedly benefiting from undervaluing total loss vehicles, all at the expense of policyholders who have already suffered significant financial loss due to accidents.
Raymond F. Wagner K.C., the founder of Wagners Law Firm, added, “Consumers trust their insurance companies to provide fair and reasonable compensation after a total loss, but we allege that these insurers are using adjustments like these as a way to artificially reduce the value of the vehicles.”
The lawsuit is designed to ensure that consumers who were underpaid due to these adjustments are fully compensated.
Who is Eligible for This Car Insurance Class Action?
The proposed class action is open to Canadian residents (excluding those in Quebec) who filed car insurance claims related to total loss accidents. The claims must have been assessed using valuation reports that included the disputed adjustments.
Insurers Named in the Lawsuit
The lawsuit targets insurers that rely on Mitchell and Audatex reports. The companies named in the class action include:
Insurers that rely or relied on Mitchell Reports:
- Aviva General Insurance Company
- Certas Direct Insurance Company
- Desjardins General Insurance Services Inc.
- Northbridge General Insurance Corporation
- Primmum Insurance Company
- The Wawanesa Mutual Insurance Company
- Security National Insurance Company
Insurers that rely or relied on Audatex Reports:
- Aviva General Insurance Company
- Economical Insurance
- Intact Insurance Company
- Manitoba Public Insurance
- Travelers Insurance Company of Canada
- RBC Insurance Agency Ltd.
- Axa Insurance (Canada)
- The Wawanesa Mutual Insurance Company
- Beneva Insurance Company
- The Dominion Insurance Corporation
- Royal & Sun Alliance Insurance Company of Canada
- Jevco Insurance Company
The class action seeks damages for individuals who were under-compensated due to the improper adjustments in the valuation process.
The lawsuit has yet to be certified by the courts. However, interested parties can register, learn more, and track the proceedings on the law firms’ websites.
If you have been underpaid for your total loss claim and your insurer used flawed valuation reports, this class action may offer an opportunity for you to seek justice and get the compensation you deserve.